The VA and a Government Shutdown

What is open for business during the government shutdown? Not the Internal Revenue Service, or the United States Parks Service. The Coast Guard remains without pay, and the Department of Homeland Security is also unfunded. But what about the Department of Veterans Affairs?

The VA has issued statements in the past during a government shutdown to remind those relying on VA care and services that the agency is still open for business. Statements have included that there are VA services designed to give “furloughed Veteran federal employees affected with much needed support and relief.”

How The VA Helps Veterans During a Government Shutdown

VA benefits remain available during a government shutdown, but there are certain benefits that happen to be at peak processing times coinciding with the federal budget trouble in Washington D.C., and other benefits that are directly affected by a furloughed veteran’s ability to make payments on VA home loans, etc.

There are several areas where VA resources can be used to offset hardship brought on by furloughs and suspension of pay.

VA Compensation and Pension Continues To Be Paid During a Government Shutdown

Over five million disabled veterans, dependents and survivors would continue to receive their payments from the Department of Veterans Affairs.

Working Overtime To Process And Pay VA Education Benefits

The Department of Veterans Affairs official site acknowledges the high-demand months of January and February for GI Bill and other VA education benefits. The VA official site says the agency has “…over 1,100 employees processing GI Bill benefits.” Those experiencing financial hardships over the furlough or who experience a delayed GI Bill payment should call 1-888-GIBILL-1 for advice and help.

Benefit Overpayments, Debt Relief, and Financial Assistance

Veterans who are paying back overpayments of a veterans’ benefit and need “temporary financial relief” during the furlough period should call the Debt Management Center at 800-827-0648. The center may be authorized to suspend collection activity on your account but this is not automatic and must be requested.

 Why Federal Employees Furloughed Or Working Without Pay Can’t Just Get Part-Time Jobs

It is not always possible for federal employees to simply find and work a part-time job during a shutdown. The VA official site has instructions for its’ federal employees in this area, which includes the following:

“Even while on furlough, an individual is an employee of the Federal government. Therefore, the Executive Branch-wide standards of ethical conduct…which include rules on outside employment, continue to apply to employees on furloughs. Additionally, there are statutes which prohibit certain outside activities…”

It’s clear from the reading above that the simplest solution for getting through current circumstances isn’t as easy as locating another source of income.

VA Community Care

VA assistance is available for veterans who struggle to make required co-pays for healthcare and other issues, and this help is offered regardless of government shutdowns or other circumstances.

A veteran should contact the VA any time there is a job loss, a decrease in income, or an increase in healthcare expenses which must be covered out-of-pocket. Ask the VA to make a determination about qualifying for financial hardship assistance which can take the form of a repayment plan, a copayment exemption, or a debt waiver.

Did you know you have the right to establish a monthly repayment plan “at any time during your enrollment in VA health care” if you can’t pay the debt off right away? The VA official site says typical payment plans are no longer than 36 months but the size of the debt and ability to pay will be determining factors in creation of the payment plan.

VA Home Loans Are Still Available During The Government Shutdown

In times of crisis, the VA has urged participating lenders to be more flexible when working with VA borrowers and loan applicants who have lost income after natural disasters and other circumstances. The current federal budget crisis is no exception; VA guidance to lenders includes encouragement to waive late fees, forgive late payments, and avoid negative credit reporting during the crisis.

New VA mortgage loans are definitely possible even if the applicant is still furloughed. Learn more about VA loans and how they are handled during the shutdown by calling the VA at 877-827-3702.

It is extremely important that VA loan borrowers affected by the government shutdown contact their lenders as soon as financial difficulty is known – the longer a home owner waits and the more payments missed, the fewer options the borrower has to avoid loan default and foreclosure.

It is strongly recommended to contact the participating VA lender as soon as possible in addition to any other help you seek while dealing with a loss of income due to being furloughed or having payments suspended until the new federal budget is passed.

Vocational Rehabilitation and Employment (VR&E) Is Still Operational During The Shutdown

VR&E applicants are directed to meet with their counselors; the usual eligibility determinations will be made for services and career planning. And these benefits are not limited to those who were currently working with a VR&E counselor before the government shut down; the VA encourages new applications even with the current furloughs in place.

VA Insurance Is Still Available During The Government Shutdown

The Office of Servicemembers’ Group Life Insurance has not stopped issuing new policies. It still collects premiums, services insurance policies, and pays claims.

VA loans, VA Co-Pays, And Other Expenses Are Still Due

Any relief from medical copays, VA mortgage payments, GI Bill overpayment issues, or other indebtedness will still be due unless the veteran or family specifically requests other arrangements. None of the financial relief offered on VA loans, medical care co-pays or other expenses is automatic-the borrower must make arrangements with the creditor to get the help needed as the budget impasse wears on.

Some kinds of financial relief are dependent on the borrower contacting the creditor before the account experiences missed payments. Others may depend on how long since a missed payment before the borrower requests assistance.

Those who are more than one payment behind on their monthly debts may find their options are more limited than those who contacted the creditor ahead of any late or missed monthly bills.

Weigh Your Options Carefully

Some affected by suspended pay or furloughs may be tempted to start putting their living expenses on a credit card. Others may decide to take out a personal loan to avoid running up credit card debt.

The important issue here is the long-term cost of your short-term money crisis management approach. A personal loan and a credit card have different interest rates, terms, and conditions. Which makes the most financial sense and costs less when it’s all said and done?

A borrower who takes out a personal loan at an interest rate lower than a credit card and has the goal of repaying the loan as soon as feasible could save more money in the long run by not paying long-term interest rates on credit card cash advances or similar measures. Do the math before you settle on a course of action for your short-term financial needs and see how much your options will actually cost over time.

VA Advice To Those Struggling Financially During The Government Shutdown

The Department of Veterans Affairs urges veterans and family members to continue using VA services and treatment while the federal budget crisis is being addressed.

But there are other steps the VA wants affected vets and families to take including reaching out to financial institutions such as credit unions and military-friendly banks to see what stopgap measures might be available to help ease the financial burden, avoid loan default, and limit the damage to long-term financial plans as well as address short-term money needs.

The VA has put together a detailed list and points of contact for assistance here.